Read the passage and answer the question:

The revenue was not realised with punctuality, and lands to a considerable extent were periodically exposed to sale by auction. In the native year 1203 corresponding with 1796-97, the land advertised for sale comprehended a jumma or assessment of sicca rupees 28,70,061, the extent of land actually sold bore a jumma or assessment of 14,18,756, and the amount of purchase money sicca rupees 17,90,416. In 1204, corresponding with 1797-98, the land advertised was for sicca rupees 26,66,191, the quantity sold was for sicca rupees 22,74,076, and the purchase money sicca rupees 21,47,580. Among the defaulters were some of the oldest families of the country. Such were the rajahs of Nuddea, Rajeshaye, Bishenpore, (all districts of Bengal), .... and others, the dismemberment of whose estates at the end of each succeeding year, threatened them with poverty and ruin, and in some instances presented difficulties to the revenue officers, in their efforts to preserve undiminished the amount of public assessment.

The zamindars defaulted in payments because :

The initial demands from the zamindars were very high.

The correct answer is Option (2) → The initial demands from the zamindars were very high.

"The initial demands from the zamindars were very high"

This was because it was felt that if the demand was fixed for all time to come, the Company would never be able to claim a share of increased income from land when prices rose and cultivation expanded.

To minimise this anticipated loss, the Company pegged the revenue demand high, arguing that the burden on zamindars would gradually decline as agricultural production expanded and prices rose.

So, the correct option is [2].